Underground Construction - January 2019 - 23

Board (NEB), 3,628 miles (5,839
km) of pipeline projects have
been approved for construction
and another 2,807 miles (4,518
km) of projects are under review.
Canada was producing a record
4.9 million barrels of oil per day
at the close of 2018, the NEB
estimates, but pipeline capacity
to move crude to U.S. refineries has not expanded as quickly.
Like their counterparts in the
Permian, Canadian producers
have struggled with steep price
discounts due to stranded production in oil-rich Alberta - so
much so that the province was
reportedly in talks to buy rail cars
to add approximately 120,000
bpd of capacity for about $263
million (C$350 million).
By November, several Canadian crude producers had curtailed

production and asked Alberta to
mandate cuts for other producers. Last month, the Canadian
government said it will spend
C$1.6 billion ($1.19 billion),
mostly through loans, to assist
the country's oil and gas industry
that has struggled to move energy to U.S. markets due to pipeline
capacity constraints.
One major pipeline project
that would address this problem
is TransCanada's Keystone XL,
which would transport up to
830,000 bpd of crude from Alberta to the U.S. Gulf Coast. Despite
being a lightning rod for environmental activists and the subject
of numerous court challenges,
TransCanada has remained committed to Keystone XL and continues to push the project slowly
forward. In November, a U.S.

federal judge ordered a halt to the
project until another environmental review of Keystone XL,
but ruled in December that some
pre-construction activity could
resume during the review including project development work
and stakeholder meetings.
Keystone XL is to be an 1,179mile (1,897-km), 36-inch pipeline
beginning in Hardisty, Alberta,
and extending south to Steele
City, Nebraska, where it would interconnect with existing pipe. The
base Keystone Pipeline System
went into service in mid-2010.
The Trans Mountain expansion, which would nearly triple
capacity on the line to 890,000
bpd, is another major Canadian
pipeline projects that has suffered costly delays due to opposition - in this case, from inside

and outside of government. The
Canadian government agreed
in May to buy the pipeline from
Kinder Morgan Canada Ltd for
$3.5 billion (C$4.5 billion), in an
effort to ensure its expansion
went ahead. The most recent
estimated in-service date is December 2020.
As part of the project, construction is already underway on
an expansion at the Westridge
Marine Terminal in Vancouver,
with preliminary work being
done at Kinder Morgan's nearby
terminal and tank farm. The 710mile (1,150-km) Trans Mountain
pipeline began service in 1953. In
2004, Kinder Morgan began preparing for construction of a parallel line, and its completion in
2008 boosted Trans Mountain's
capacity to 300,000 bpd.

UConOnline.com | JANUARY 2019

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Underground Construction - January 2019

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